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When the Returns of an Option and Stock Are Perfectly

question 9

Multiple Choice

When the returns of an option and stock are perfectly correlated as in a two state binomial option model,the hedge ratio must be equal to ____________.


Definitions:

Value Sensitivity Quotient

A measure of how sensitive a consumer is to the price and value of a product or service, influencing their purchasing decisions.

Occupational Data

Information related to job characteristics, employment trends, salary ranges, educational requirements, and growth projections for various professions.

Service Charge

A service charge is an additional fee collected for the provision of a service, often seen in hospitality, banking, and restaurants.

Interest

The fee paid for borrowing money, typically expressed as a percentage of the money borrowed, or curiosity and attention towards something.

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